JS 99: Entrepreneurship in India with Ronnie Screwvala of Time Magazine’s 100 Most Influential People & Founder of UTV Group

April 2nd, 2015 by Jason | Comments Off on JS 99: Entrepreneurship in India with Ronnie Screwvala of Time Magazine’s 100 Most Influential People & Founder of UTV Group

Ronnie Screwvala has developed an impressive resume for himself and as been named 78 out of 100 most influential people in the world on Time’s 100 list. He has also been named Asia’s Most Powerful 25 by Fortune magazine and will be coming out with a new book titled Dream With Your Eyes Open. Ronnie is the founder of UTV Group and has successfully made a name for himself in India as well as world wide. Ronnie sits down with Jason Hartman to talk about what’s happening in the entrepreneur sector in India, the movie industry, and much more on today’s episode.

Key Takeaways:
2:15 – When Ronnie started as an entrepreneur 25 years ago, India didn’t really encourage entrepreneurship and it unfortunately still doesn’t.

3:25 – It’s only when an Indian fails at successfully landing a good job do they move on to being entrepreneurs.
8:00 – The mobile and internet sectors are fast growing right now and offer extremely huge opportunities for new entrepreneurs.

12:20 – New generations are looking at producing more products than being just a cheap outsource company.

14:20 – Ronnie talks about India’s movie industry.

17:05 – Entrepreneurship is not an outing, it’s a journey.

19:20 – Ronnie says that investing in a company really boils down to the entrepreneur running the company more so than the actual business.

Jason Hartman:
It’s my pleasure to welcome Ronnie Screwvala to the show. He is founder and CEO of UTV Group, which includes UTV Software Communications, Bloomberg UTV and UTV Motion Pictures. He’s a former managing director for Disney, UTV India, managing trustee of Swades Foundation, named to Esquire’s list of 75 Most Influential People of the 21st century. Ranked 78 among the 100 most influential people in the world on the Time 100 list and named Asia’s Most Powerful 25 by Fortune and Entrepreneur of the Year by Ernst & Young. He is author of the new book Dream With Your Eyes Open: An Entrepreneurial Journey. Ronnie, welcome, how are you?

Jason:
It’s a pleasure to have you. You’re coming to us from Mumbai, India is that correct?

Ronnie
That’s correct. That’s correct.

Jason:
So, I had a chance to watch your video. I”m looking forward to the book coming out. Tell us a little bit about your background and entrepreneurial journey and maybe the contrast between going into one of the profession or being an entrepreneur.

Ronnie:
Sure, I think, well, my journey started about 25 years ago, at least in India at that time the ecosystem was not one which evangelized or promoted entrepreneurship. It hasn’t changed that much in the last 25 years, so when I sort of exited my media and entertainment journey after about 25 years by diversify UTV to the Walt Disney company, I sort of stepped back a bit and looked at things and I found that opportunities for entrepreneurship needs to be evangelized. What the challenges I faced in my 25 years I didn’t want the younger generation today to face. So, my inspiration of writing this book on entrepreneurship was really to share some of my antidotes and experiences. In India, there are two aspects here, a huge, huge deep sense of fear of failure as compared to some of the Western economies where actually failure is evangelized and people say fail fast, fail good, and move forward and the second here is most people feel it’s much more of safer to journey to get a good professional job and only when you don’t land yourself a good job do you actually get down to entrepreneurship. So, this book was just out to shatter these two myths to a certain extent and really put this up center stage.

Jason:
So, you’re saying that the Indian culture was one of saying go get a good job, but if you’re a failure at that, then you become an entrepreneur and you wanted to change that thought of is that correct?

Ronnie:
Yes, that it is equally balance. That you should be able to choose between the two and that it’s not a neither or situation, number one, and that’s it not an option that you only become an entrepreneur because you couldn’t land yourself a good job.

Jason:
How do you perceive these challenges that India has in this cultural thinking versus other parts of the world?

Ronnie:
Well, I think again, we’re much more stronger family values here, even young kids or people 20-25 whether they want to actually branch out on their own, they’re extremely respectful to their elders, so you don’t normally go out there and challenge yourself/ Over the last 60 years since our independence actually family business has been the norm and it’s kind of gets handed down from generation to generation and even today the younger generation wants to look at something different and more into technology and ecommerce and some of the new economies, they are little reticent to let go of family jewel or a family business even though it might be going or it could be an anachronism and I think that’s the sort of break out change in cultural that’s happening here.

I mean, to a certain extent with a younger democracy in the world, which I think is an opportunity, but could be a huge challenge, because we’re going to churn out 10 million people a year that’s going to need jobs and I don’t believe in India we have an opportunity for 10 million jobs a year, so in the next 10 years, you’re going to have a 100 million people and not enough jobs for everybody, so entrepreneurship is definitely the ecosystem to create right now.

Jason:
So, the jobs just can’t be created fast enough. It needs to come from entrepreneurs, that’s what you’re saying, right.

Ronnie:
That’s right and you, I think there’s a strong distinction between people become professional and people becoming, creating their own livelihood, because entrepreneur, the entrepreneur is to create multiple other jobs rather than just for yourself.

Jason:
Yeah, absolutely. It has that multiplier affect. You know, I was in India about six or seven years ago. I was in Delhi and then went over and saw the Taj Mahal, really incredible by the way. It’s just such a huge country, there’s so many issues and at the time I was reading a book called the Elephant and the Dragon on that trip and I just found it interesting comparing, you probably heard of that book, comparing and contrasting India to China and so forth. You know, of course, China has the benefit of being a communist country and I saw that sarcastically, of course, but you know, in some ways that allows them to get ahead very quickly because, you know, they an just make decision without having any demographic process, you know, if they want to build a highway or a train line or airport, they just knock down everybody’s house, kick them out, and build it, you know, it’s really quite simple.

In India, of course, you have a democracy so you have human rights issues, thankfully, and things like that, but there is something to be said about that efficiently of certain planning, at least in some small ways. I’m not in favor of it, by the way.

Ronnie:
It’s an absolutely fair point and I would say in the last decade, you used the word ‘make their own decision’ I think more the background from that perspective especially if you’re looking it a communist one is where it’s sort of driven down and these issues aren’t even made and it’s driven down. I think India can make its own decisions and basically it’s all about leadership at the end of the day. Of course in any democracy and you’re facing them in the United States today and may face it for the next decade, who knows, we don’t have a complete command of the senate and the house and have a ruling president in the same party, but you know, that can create a fair amount of its own challenges, but you still have decision maker going forward.

So I think India may be a little challenged in this leadership in the recent past, but I think we’ve gone past that, got some very decisive leadership and I think, you know, we’re never going to be not anything else but a democracy and the opportunities are huge, so I think it’s the, you know, as the Chinese would say, no pun intended, the next ten years could be the year of the elephant.

Jason:
Yeah, absolutely. Well, China has got a big demographic problem among many other problems, but we’ll see how it all turns out. I think that one child policy is really going to catch up with them in very serious and negative ways in the next ten years or so at least that’s what a lot of my guests have been talking about.

Ronnie:
In some ways, but I think they’ve done a great job in sort of scaling themselves up, looking at a very strong export based economy. I think, yes, look at it different and not get obsessed about anything else but its own opportunities, which industries do you think provide the best opportunities in the India and around the world for today’s entrepreneur? Well, I think, you know, if you take the overriding context of where everything is moving to all things mobile and internet and I think, you know, that in some aspects this is sort of fast growing segment and in some aspects I think it’s an over crowded segment, because it’s become almost like a fad and I think it’s a little bit of caution, but I think all things that are digital and internet and mobile is specifically in a country like India offers extremely huge opportunities for something as diverse as media to security to everything else, but I think for countries like India, you know, otherwise in a mature country would be looked at already taken care of, which is the health sector, the education sector, to a certain extent the sort of branded agriculture sector and other aspects. Actually, those are the really scalable models in developing countries and I think that’s really where you’ll see as many opportunities as you will see in the digital media space or in the ecommerce space.

Jason:
What do you think is, you know, going on in the economy there? When I was there the GDP numbers were very good, but they have to be when you have such a big population that’s the same thing is true of China, of course, what’s happening now? Just give us an update.

Ronnie:
I think we’re definitely on the way for a strong trajectory and I think what the present government and the change in government, as I said before, led to some very decisive leadership, some good long term thinking. I think for the first time after a long time people are not looking four year terms to make their decision, they’re willing to take a bet and take a five year, ten year view on things, which is I think what a country like this needs to be able to make a difference.

I think everybody realizes there isn’t a magic ward, but if you go at it step by step, you’ll make more deep seeded right decision than doing things that appease people from time to time, so I think those are the central shifts that are happening and I think overall all you need in a country of our size is really a strong feel good factor, people to feel unshackled and be able to get on with their lives, being able to – an ease of doing business, a clarity of thought and leadership, a little less regulation, and I think all of these is what’s falling into place right now.

Jason:
What about the corruption issue?

Ronnie:
So, I think that’s, you know, it happens and it’s there, it’s deep seeded, it happens sometimes when originate with high tax rates or a regime where family businesses have grown up on the basis of how do they carry favors and how do they necessarily work against competition, but you know the younger generation today is not going to let that happen, because I think they’re starting from we can make this business work, we don’t need to be in cahoots with the powers that be, etc. So, I think the corruption was a lot more to do with the legislation, because when you got so much things that have got so many shackles with the bureaucracy of the government, you know, it’s intertwined, but more and more the segments are tomorrow have less and less regulation and you’ll find no corruption, so we’ve got one of the bond industries for which India is know, which of course the IT industry and I think the IT industry has grown with zero corruption, because there was hardly any regulation, so I think that’s what you will see more of and it’s not going to be over night that there is sort of set of deep seeded morass was there, it can’t vanish overnight, because there is more DNA in a culture change, but I think we are headed in the right direction.

Jason:
Contrast what’s going on in Silicon Valley, if you would, to what’s going on in places like Bangalore. Is Bangalore still your Silicon Valley?

Ronnie:
Yes, in many ways it is.

Jason:
What’s Bangalore like? I wished I could go there when I was in India, you know, I was very curious about it.

Ronnie:
As a city it’s gone a little unplanned and that’s primary because everyone thinks it’s the Silicon Valley and that everyone rushed there and so I think the city planning is sort of made it bust at the seams a bit, but yes, I think for a technology capital of India, it’s pretty much what it describes to be and I think there’s an incredible amount of innovation disruption happening in the technology cities, you know, lend by Bangalore and then a few other cities. Pune coming up there, which is a distant suburb of Mumbai and even to a certain extent the new aspect of New Delhi.

So, I think all of those are emerging, but at the core I think the newer generation is looking at these innovation with a more product based part and not just being an outsourcing base. I think the younger generation today is looking at creating its own intellectual property, its own products, and not just a cheap labor arbitrage business.

Jason:
Yeah, that’s good. That’s good to hear, so when you say products, give us some examples, I mean, do you mean physical widgets? I just have to think and the reason where I’m coming from in saying that is that I just to think, you know, everybody running to these tech companies because they love the scalability of, you know, sass-based services and so forth, but gosh, I mean, do we really need all of these services? I mean, it just feels like 1999 and 2000 with some of the crazy ideas that are getting funding out there and the amount of money coming at some of these companies, I mean, you know, does it wreak of bubble? I know there are multiple questions there, but just share you thoughts if you would.

Ronnie:
Well, I would say two things. One I think that the market is absolutely real, the consumption is real, the need is real. If you want to contract most of your life and engagement in terms of a commercial sense bound to a phone or an iPad or an instrument or whatever else, then obviously you’re going to have multiple choices and much larger a la carte menu then you had before and the presumption patterns there are very discernible and there’s a strong demand for that. I think the bubble concept today is more about a group of investors that are falling over each other to make investment into these companies betting, you know, 100 multiples and 200 multiples, so again, most of these bubbles have been created by I would say bankers or investors who just don’t know when to hold back on and I think the bubble’s are created not necessarily created by entrepreneur and business in most cases, because if someone is throwing money at you and said, go get eyeballs, forget about profitability, and you going to go out and do it and I think the smarter ones are sort of holding back and doing that. So, I think the bubble could be in valuations, but the bubble is not in the consumption pattern and innovations that are happening.

Jason:
Ronnie, tell us what’s going on in Bollywood. You have a very famous movie industry there.

Ronnie:
Yes. It’s famous hopefully not because it’s just got a name sounding like Hollywood, but I think for much more, because I think it is an industry that churns out over a thousands films and multiple languages and the main language which is Hindi churns out about 220 films. It’s also ranked in foreign language firms in most countries in the top one, you know, in the top one, so I think even in the US you’ll find Indian movies constantly being in the top ten movie weekends as compared to any of the movies from anywhere else.

So, it’s a robust industry. Very strong culture. I think the challenges are two. One, for the kind of volume that we do we really account for less than two percent of the global box office, so that’s not great, but that reflects a lot from the ticket size and the ticket price of what can be changed in a country charged in a country like India for massive entertainment, so lots of eyeballs, but a much lower ticket threshold base. I think that’s one and the second is for an industry like that it would be nice for the content to travel and sort of grow internationally, but I think it does travel to a larger extent, the grammar that we use in a cinema is very strong and very well appreciated within the core audience of Indians and South Asians worldwide, but normally doesn’t travel way past that.

Jason:
Is that industry growing a lot, you know, what kind of growth is it seeing there? I’m just curious.

Ronnie:
I would say as a percentage it might look good compared to some of the Western ones, but I think the growth slated, you know, the next two-three-four years is about between 14-16%, which is not a bad growth rate.

Jason:
No, that’s phenomenal. It’s phenomenal. Very good.

Ronnie:
That’s what these economies are allowing, you know, the consumer base to grow and people see it in different windows and I think we’re just starting up on our multiple windows.

Jason:
Ronnie, tell us a little bit about your story and how you became so successful. I mean, you’ve got amazing ranking of being the most influential people. I mean, you’re on every list. Congrats!

Ronnie:
Yeah, well, I think those just happened. I think a bunch of people get to get and short list people at that stage and then they do it. To me, I think those are really nice to do, but they don’t benchmark you for what you are. I think, you know, the book that I’ve written more than half of that is about failures rather than the successes because I think it’s important to pass that message out to the new people.

You are going to fail, you’re going to fail multiple times, and there’s nothing wrong with that, and you should treat them as setbacks and go forward, but I think for most people my core communication is that sort of entrepreneurship is not sort of an outing, it’s a journey and you can’t make a deal with yourself that I’m going to try for two or three years and if I don’t succeed I can always go back to my safe zone.

You either have to stay the course, because if you don’t chances you won’t make it in any case, because it is about resilience and staying the course. It’s not about being there for a couple of years and seeing whether you can make it or not and I think that’s, if I was to look back on my 25 years, there would be more downs and ups, but staying the course has helped me a lot.

Jason:
How many businesses have you been in?

Ronnie:
Well, you know, some of them are mostly interconnected except for one, so I sort of pioneered cable television in the country and then an opportunity knocked on my door while I was doing cable television to become a tooth brush manufacturer, which is obviously for most people the eyebrows get raised to what’s the connection. There is none, just an opportunistic thing that an entrepreneur do and I kind of scaled that business to be one of the largest tooth brush manufacturers in India, which has to say a lot because we have a lot of people and a lot of teeth to brush and I think after that went on to create the media and entertainment company that UTV was, diversified into home shopping, but most of everything that one has done has been in media, because I count home shopping, cable TV, and media and entertainment and the movie studio and the television channels all as sort of that same one bucket, but overall, I would say there were about 4 different enterprises.

Jason:
So, four overall and have you invested in a lot of other people’s businesses? I kind of assume you’re going to say yes to that.

Ronnie:
In my second endings right now, I’m starting up fresh and building businesses, one in education, because I think that’s very, very scalable in India, second in this sort of digital space, and third in sports, because outside of cricket, we’re sort of betting on a local sport here called Kabaddi and on football where India doesn’t rank too high, but I think over the next ten years it can.

Jason:
Football is soccer, right? When you say that?

Ronnie:
Yes, football is soccer.

Jason:
Just wanna get the translation.

Ronnie:
That’s right and yes I have invested in about 10 or 15 companies at sort of early stage, not really startup, but an early stage, varying from ecommerce to micro housing finance to agriculture are some of the others.

Jason:
Yeah, fantastic. Any advice for people as to how to invest in companies or how to buy businesses?

Ronnie:
I think the investment really boils down to the entrepreneur. You gotta spend a lot of time to figure whether you got out of the bank entrepreneur, because it all finally boils down to that. There’s that much you’re going to be able to do. There’s that much you’re going to be able add value, there’s that much you’re going to be able to mentor. You’re not involved with the day to day operations, you can’t haul somebody up the course in that perceptive, so if you’re really investing in somebody, you gotta be very, very sure from that perspective that you got the entrepreneur right. The second is then get the sector right and the head room and the size of the industry right, because sometimes even an average entrepreneur can do very well if a sector is growing by 20-30%, but first and foremost is the entrepreneur.

Jason:
Yeah, it absolutely is. Ronnie, give out your website or your Twitter or anything you’d like people to know where they can find you.

Ronnie
Yeah, so it’s @RonnieScrewvala, which is my Twitter account and I think that’s the best way to reach out.

Jason:
You don’t want to give the DreamWithYourEyesOpen.org website?

Ronnie:
Yeah, it is actually the website there is DreamWithYourEyesOpen, all one word, .org.

Jason:
Fantastic. Good website by the way. Enjoyable video. Ronnie, thank you for joining us today.

Ronie:
Thank you, thank you very much. It’s been great fun.

Announcer:
This show is produced by the Hartman Media Company, all rights reserved. For distribution or publication rights and media interviews, please visit www.hartmanmedia.com or email [email protected] Nothing on this show should be considered specific personal or professional advice. Please consult an appropriate tax, legal, real estate or business professional for individualized advice. Opinions of guests are their own and the host is acting on behalf of Platinum Properties Investor Network Inc. exclusively.